Author: Zacks Equity Research

MC – Moelis (MC) Up 1.8% Since Last Earnings Report: Can It Continue?

It has been about a month since the last earnings report for Moelis (MC Free Report) . Shares have added about 1.8% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Moelis due for a pullback? Before we dive into how investors and analysts have reacted as of late, let’s take a quick look at the most recent earnings report in order to get a better handle on the important drivers.

Moelis & Company Q2 Earnings Beat as Revenues Improve Significantly

Moelis & Company recorded second-quarter 2021 adjusted earnings per share of $1.19, surpassing the Zacks Consensus Estimate of 82 cents. In the prior-year quarter, the company recorded a loss per share of 11 cents.

Results were driven by a substantial improvement in revenues. Moreover, the company had a solid liquidity position in the reported quarter. However, a rise in expenses was the undermining factor.

Net income (GAAP basis) was $93.2 million or $1.17 per share against a net loss of $9 million or 10 cents per share recorded in the prior-year quarter.

Revenues Improve Significantly, Expenses Rise

Total revenues jumped significantly year over year from $159.9 million to $360.9 million. The top line outpaced the Zacks Consensus Estimate of $268 million.

Total operating expenses (adjusted basis) were $242.7 million, up 37% year over year. The rise was due to an increase in both compensation and benefits costs, and non-compensation costs.

Other income was $2.8 million against other expenses of $3.3 million recorded in the prior-year quarter.

As of Jun 30, 2021, the company had cash and liquid investments of $280.7 million, with no debt or goodwill.

Share Repurchase Update

In the reported quarter, the company repurchased 0.4 million shares for $21.7 million.

How Have Estimates Been Moving Since Then?

It turns out, estimates review have trended upward during the past month. The consensus estimate has shifted 6.19% due to these changes.

VGM Scores

At this time, Moelis has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a C. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of A. If you aren’t focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Moelis has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.

LNN – Solid Demand in End Markets to Aid Lindsay's (LNN) Growth

Lindsay Corporation (LNN Free Report) is well-poised to gain on improving farm dynamics in the United States owing to rising farm income and increasing commodity prices. The company’s infrastructure business is also positioned well, courtesy of strong demand for Road Zipper projects and transportation safety products and higher infrastructure spending. A strong balance sheet, focus on introducing technologically advanced products, and investment in organic growth and acquisitions will drive growth for the company.

Favorable Farm Fundamentals Bode Well

Lindsay is witnessing improving order levels aided by favorable agricultural market conditions in North America. Prices of corn and soybean, the most important grains for cash crop farming in the United States have been gaining this year. Per the United States Department of Agriculture’s (USDA) latest report, for 2021 average corn yield is forecast at 174.6 bushels per acre, and soybean yields are expected to average 50.0 bushels per acre. Both are, however, lower than USDA’s July estimates, which led to an uptick in commodity prices. In this backdrop of strong demand and apprehensions regarding the drought conditions, prices are likely to go up further.

On top of this, Brazil’s second corn crop has plunged to 10-year low due to unfavorable weather. This will further widen the gap between demand and supply and push up prices. High commodity prices and the consequent pickup in farm income will persuade farmers to continue spending on agricultural equipment, which in turn will drive Lindsay’s top line.

Infrastructure Business Poised to Grow

The company’s infrastructure business is benefiting from the strong momentum in Road Zipper Systems. Lindsay’s Road Zipper System is a highly differentiated product that positively addresses key infrastructure needs such as reducing congestion, lowering carbon emission, and increasing driver safety, which has led to its global popularity.

In September 2020, the Fixing America’s Surface Transportation (FAST) Act has been extended for one year. The extension includes $13.6 billion to maintain the Highway Trust Fund’s solvency at current funding levels ($47.1 billion for highway programs and $12.3 billion for transit programs) through fiscal year 2021. This extension will provide much-needed funding certainty to state and local governments navigating significant revenue shortfalls due to the COVID-19 pandemic. With the U.S Senate passing the $1 trillion infrastructure bill, the perked up investment in roads represents a huge opportunity for the segment.

Investment in Technology to Provide Competitive Edge

Focus on bringing technologically advanced products to the market will fuel Lindsay’s top line. In April 2020, the company completed the buyout of Net Irrigate, LLC, which will expand the number of irrigated acres managed under the company’s FieldNET platform. This acquisition strengthens Lindsay’s market position in remote monitoring capabilities. The company is witnessing strong growth in technology penetration, which will aid performance in the days ahead. The company expected new product revenues as a percentage of total revenues to go up from 2% in fiscal 2017 to 15% in 2023.

A Solid Balance Sheet

Lindsay has a strong balance sheet that will help it navigate the coronavirus-induced uncertainty. As of May 31, 2021, the company had an available liquidity of $190.5 million, with $140.5 million in cash, cash equivalents and marketable securities and $50 million available under revolving credit facility. Lindsay’s total debt was around $115.8 million, of which $115 million matures in 2030. The company’s total debt to capital ratio has gone down to 0.26 as of May 31, 2021 from 0.29 as of May 31, 2020. It is also much lower than the industry’s total debt to capital ratio of 0.76. Its times interest earned ratio was 13.8, much better than the industry’s 5.2. Lindsay’s capital-allocation plan is to continue investing in organic growth and make synergistic acquisitions while enhancing returns to stockholders. Capital expenditures for fiscal 2021 are expected between $25 million and $27 million, including equipment replacement, productivity improvements and new product development.

Price Performance

Lindsay’s shares have gained 60.2% in the past year compared with the industry’s rally of 80.2%.

Zacks Rank

At present, Lindsay carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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Other Stocks to Consider

Some other top-ranked stocks in the Industrial Products sector include Encore Wire Corporation (WIRE Free Report) , Deere & Company (DE Free Report) and Titan International Inc. (TITN Free Report) . While Encore Wire flaunts a Zacks Rank #1, Deere and Titan International carry a Zacks Rank #2.

Encore Wire has a projected earnings growth rate of 332.6% for fiscal 2021. In a year’s time, the company’s shares have gained 60%.

Deere has an estimated earnings growth rate of 107% for the ongoing year. The company’s shares have appreciated 88% in the past year.

Titan International has an estimated earnings growth rate of 155% for the current year.  The company’s shares have soared 130% in the past year.

SNOW – Snowflake (SNOW) to Report Q2 Earnings: What's in the Cards?

Snowflake (SNOW Free Report) is set to release second-quarter fiscal 2022 results on Aug 25.

The Zacks Consensus Estimate for the top line is currently pegged at $255.2 million. Moreover, the consensus mark for the bottom line has been unchanged at loss of 15 cents per share over the past 30 days.

Markedly, this would be the company’s fourth-earnings call. This Data Cloud platform provider began trading on Nasdaq from Sep 16, 2020.

Factors to Note

Snowflake’s second-quarter fiscal 2022 results are expected to reflect the ongoing transition from cloud-based repositories and on-premises data centers to the Data Cloud.

Strong adoption of its cloud-native solutions from Media and telecom, technology, financial services and health care customers is expected to have aided top-line growth in the to-be reported quarter. Moreover, growth in exposure to the data warehousing market and an expanding enterprise customer base are expected to have driven top-line growth.

At the end of the fiscal first quarter, the company had 4,532 total customers and 104 customers with trailing 12-month product revenues greater than $1 million, an increase from 77 customers in the previous quarter. The momentum is expected to have continued in the to-be-reported quarter.

Key Developments in Q2

In the fiscal second quarter, Snowflake expanded data offerings and capabilities on Snowflake Data Marketplace, as well as general availability of the Data Marketplace, to help customers across industries access more data in the Data Cloud for quality data insights.

Moreover, the company announced support for Unified ID 2.0 to help organizations easily enrich audience data, without sharing consumers’ personally identifiable information (PII). With Unified ID 2.0 support, Snowflake customers will be able to optimize their data-first advertising strategies by directly activating audiences on any platform that has adopted Unified ID 2.0, using Snowflake’s secure data sharing technology.

What Our Model Indicates

Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.

Snowflake has an Earnings ESP of 0.00% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are some companies worth considering as our model shows that these have the right combination of elements to beat on earnings this reporting cycle:

HP Inc. (HPQ Free Report) has an Earnings ESP of +1.00% and a Zacks Rank #3, at present.

Box, Inc. (BOX Free Report) currently has an Earnings ESP of +3.45% and a Zacks Rank of 3.

Chewy Inc. (CHWY Free Report) currently has an Earnings ESP of +20.00% and a Zacks Rank of 1. You can see the complete list of today’s Zacks #1 Rank stocks here.

LPLA – LPL Financial (LPLA) July Metrics Increase on Market Gains

LPL Financial Holdings Inc.’s (LPLA Free Report) total brokerage and advisory assets of $1.13 trillion at the end of July 2021 grew 1.6% from the prior month and 42.7% year over year. Of the total assets, brokerage assets were $541.4 billion and advisory assets totaled $588.4 billion.

The increase was mainly driven by the impressive performance of the equity markets and brokerage assets from M&T Bank that onboarded in July.

Total net new assets were $10 billion in the reported month. This included $3 billion of brokerage assets from M&T Bank that onboarded in July. In July 2021, net new assets were $10 billion compared with $2.9 billion in July 2020.

LPL Financial reported $48.5 billion of total client cash balance, flat from June 2021 but up 7.5% from $45.1 billion recorded in July 2020. Further, of the total balance, $34.4 billion was insured cash and $7.9 billion was deposit cash, while the remaining was money-market balance.

Shares of LPL Financial have surged 74.5% in the past 12 months, underperforming 84.1% growth recorded by the industry.

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The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Brokerage Firms

Interactive Brokers Group (IBKR Free Report) released the Electronic Brokerage segment’s performance metrics for July 2021. The segment, which deals with the clearance and settlement of trades for individual and institutional clients globally, reported a 32% year-over-year rise in client daily average revenue trades to 2,363,000.

Tradeweb Markets Inc. (TW Free Report) reported total trading volume of $20.6 trillion in July 2021. Average daily volumes were $972.2 billion, up 34.2% year over year.

Charles Schwab (SCHW Free Report) released its activity report for July 2021. Total client assets were $7.64 trillion, up 1% from June 2021 and 79% from July 2020. Client assets receiving ongoing advisory services were $3.7884 trillion, up 1% from the prior month and 74% year over year.

MRNA – Is Moderna (MRNA) COVID-19 Jab Heart Risk More Than Pfizer's?

Moderna’s (MRNA Free Report) mRNA-based COVID-19 vaccine, mRNA-1273 is being investigated by the FDA and the U.S. Centers for Disease Control and Prevention (CDC) for higher risk of myocarditis, a rare condition of heart inflammation, in younger adults per a Washington Post article. The article implies that the risk of myocarditis following inoculation with mRNA-1273 can be more than previously thought and is also higher than Pfizer (PFE Free Report) /BioNTech’s (BNTX Free Report) mRNA-based vaccine, BNT162b.

Per the same Washington Post article, the claims of higher risk of myocarditis, especially for males below the age of 30 or so, following Moderna’s jab are majorly based on data from Canada. The same data suggests that vaccination with mRNA-1273 may increase the risk of incidence of myocarditis by 2.5-fold compared to BNT162b. U.S. health officials are currently reviewing the data as well as data generated in the United States for a possible link to higher risk of heart inflammation. The report stated that the officials believe it is too early to conclude and issue any kind of new or revised warning or recommendation for mRNA-1273.

We note that Pfizer’s BNT162b is already leading the vaccination race with $11.3 billion sales in the first half of 2021 compared to nearly $6 billion of sales from mRNA-1273. Moreover, the anticipated sales for 2021 for BNT162b and mRNA-1273 stands at $33.5 billion and approximately $19.2 billion, respectively.

Meanwhile, U.S. health officials have decided to start providing booster doses to the country’s citizens beginning in the first week of fall that will start on Sep 20. Amid rising support for booster doses for better protection against the Delta variant, the potential link to higher risk of heart inflammation may hurt demand for Moderna’s mRNA-1273, pushing it further back in the competition. Moreover, a few new COVID-19 vaccines may enter the U.S. markets this year, which will result in increased competition.

Shares of Moderna fell 5.8% on Aug 19, following the reports on probe for higher risk of heart inflammation. The company’s shares have surged 259.4% so far this year against the industry’s decrease of 0.3%.

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We note that the CDC concluded earlier in June that there is a “likely association” between mRNA-based COVID-19 vaccines and increased cases of heart inflammation, including myocarditis and pericarditis, in adolescents and younger adults. Heart inflammation was reported after the first dose of mRNA-1273 and BNT162b in a small proportion of individuals,which increased further following the second dose. However, similar inflammation cases were not reported following vaccination with J&J’s (JNJ Free Report) adenovirus-based COVID-19 vaccine. Following the investigation, the labels of both mRNA-based vaccines were updated to include a warning label for increased risk of myocarditis.

Meanwhile, the United States is not the only country to probe various risks with possible links to mRNA-based COVID-19 vaccines. Earlier this month, the European Medicines Agency initiated an investigation to study three new conditions found in a small proportion of individuals receiving mRNA-based vaccination.The individuals immunized with a mRNA-based vaccine reported that they developed either erythema multiforme (allergic skin reaction), glomerulonephritis (kidney inflammation) and/or nephrotic syndrome (renal disorder).

Zacks Rank

Moderna currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

LH – LabCorp (LH) Inks Deal to Assess Disparities in Drug Development

Laboratory Corporation of America Holdings (LH Free Report) or LabCorp recently partnered with Community Clinical Oncology Research Network, LLC (CCORN) to better understand the impact of disparities in precision medicine for cancer patients through information gathered from patient registry and biobank.

The information from the biobank and patient registry will be utilized to design future cancer clinical trials, assist in patient recruitment efforts and help encourage the expansion of genomic profiling testing in diverse populations.

Per management, this collaboration will ensure that oncology clinical research reaches community oncology practices that serve cancer patients from diverse populations.

Details of the Collaboration

The PREFER (Prospective rEgistry oF advanced stage cancER) patient registry will provide key insights derived from clinical and laboratory data concerning the unmet needs of cancer patients from diverse populations. This patient registry will enroll up to 2,500 patients with advanced solid-tumor cancer from multiple sites across the United States, starting Sep 1, 2021. The OmniSeq INSIGHT, a tissue-based test, will be used to detect the prevalence of actionable biomarkers and driver mutations, which are unique to different ethnicities.

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Labcorp and CCORN will also create a biobank that will enable the broader oncology community to access real-world evidence and identify the source of disparities.

Significance of the Collaboration

Despite the progress made to improve cancer medicine outcomes, current standards of care remain inadequate, in part due to lack of accessibility and diversity in clinical trials, and limited access to advanced diagnostic testing. The drug development processes have been rather unsuccessful in reflecting demographic diversity in clinical trials, which further contributes to disparities in care and outcomes for a diverse patient population.

Per CCORN management, the recent partnership with Labcorp will be a major step toward assessing the disparities in cancer drug development.

Industry Prospects

Per a report published in Grand View Research, the global oncology clinical trials market is expected to see a CAGR of 5.4% from 2020 to 2027. Factors such as increasing number of cancer cases, growing need for personalized medicines, rise in the R&D activities in oncology and supportive government initiatives are expected to drive the market during the forecast period.

Given the market prospects, LabCorp’s recent partnership to help design future cancer clinical trials in diverse patient population seems well-timed.

Notable Developments

In August 2021, LabCorp acquired Ovia Health, a digital health platform that is utilized by women seeking information and support with family planning, pregnancy and parenting. Through this acquisition, the company expects to expand its leadership in women’s health solutions. This buyout will also open new avenues for personalized care experiences and facilitate better dialogue between health care providers and their patients.

In July 2021, Labcorp began offering clonoSEQ, the first FDA-approved test to monitor the residual cancer cells in a patient’s body during and after treatment for lymphoid cancers. The recent offering by Labcorp is expected to expand its capabilities for diagnosing and detecting blood cancers. The clonoSEQ test, developed by Adaptive Biotechnologies, uses next-generation sequencing technology and proprietary bioinformatics to provide powerful insights from diagnosis, through treatment and into survivorship.

In the same month, the company launched the therascreen KRAS PCR Mutation Analysis, a companion diagnostic for a new treatment option developed by Amgen. The therascreen KRAS will identify patients with non-small cell lung cancer who are eligible for treatment with Amgen’s LUMAKRAS (sotorasib).

Share Price Performance

The stock has outperformed its industry over the past year. It has grown 67.6% compared to the industry’s 27.8% growth

Zacks Rank and Other Key Picks

Currently, LabCorp carries a Zacks Rank #3 (Hold).

A few similar-ranked stocks from the Medical-Dental Supplies industry include Merit Medical Systems, Inc. (MMSI Free Report) , Henry Schein, Inc. (HSIC Free Report) and West Pharmaceutical Services, Inc. (WST Free Report) , each sporting a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

Merit Medical has a long-term earnings growth rate of 13.6%.

Henry Schein has a long-term earnings growth rate of 13.9%.

West Pharmaceutical has a long-term earnings growth rate of 28.4%.

DE – Deere (DE) Q3 Earnings and Revenues Top Estimates

Deere (DE Free Report) came out with quarterly earnings of $5.32 per share, beating the Zacks Consensus Estimate of $4.49 per share. This compares to earnings of $2.57 per share a year ago. These figures are adjusted for non-recurring items.

This quarterly report represents an earnings surprise of 18.49%. A quarter ago, it was expected that this agricultural equipment manufacturer would post earnings of $4.44 per share when it actually produced earnings of $5.68, delivering a surprise of 27.93%.

Over the last four quarters, the company has surpassed consensus EPS estimates four times.

Deere, which belongs to the Zacks Manufacturing – Farm Equipment industry, posted revenues of $10.41 billion for the quarter ended July 2021, surpassing the Zacks Consensus Estimate by 2.10%. This compares to year-ago revenues of $7.86 billion. The company has topped consensus revenue estimates four times over the last four quarters.

The sustainability of the stock’s immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management’s commentary on the earnings call.

Deere shares have added about 33.4% since the beginning of the year versus the S&P 500’s gain of 17.3%.

What’s Next for Deere?

While Deere has outperformed the market so far this year, the question that comes to investors’ minds is: what’s next for the stock?

There are no easy answers to this key question, but one reliable measure that can help investors address this is the company’s earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately.

Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.

Ahead of this earnings release, the estimate revisions trend for Deere was favorable. While the magnitude and direction of estimate revisions could change following the company’s just-released earnings report, the current status translates into a Zacks Rank #2 (Buy) for the stock. So, the shares are expected to outperform the market in the near future. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

It will be interesting to see how estimates for the coming quarters and current fiscal year change in the days ahead. The current consensus EPS estimate is $3.94 on $10.3 billion in revenues for the coming quarter and $18.01 on $39.55 billion in revenues for the current fiscal year.

Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Manufacturing – Farm Equipment is currently in the top 15% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.

AMAT – Applied Materials (AMAT) Q3 Earnings and Revenues Beat Estimates

Applied Materials (AMAT Free Report) came out with quarterly earnings of $1.90 per share, beating the Zacks Consensus Estimate of $1.76 per share. This compares to earnings of $1.06 per share a year ago. These figures are adjusted for non-recurring items.

This quarterly report represents an earnings surprise of 7.95%. A quarter ago, it was expected that this maker of chipmaking equipment would post earnings of $1.51 per share when it actually produced earnings of $1.63, delivering a surprise of 7.95%.

Over the last four quarters, the company has surpassed consensus EPS estimates four times.

Applied Materials, which belongs to the Zacks Semiconductor Equipment – Wafer Fabrication industry, posted revenues of $6.2 billion for the quarter ended July 2021, surpassing the Zacks Consensus Estimate by 4.66%. This compares to year-ago revenues of $4.4 billion. The company has topped consensus revenue estimates four times over the last four quarters.

The sustainability of the stock’s immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management’s commentary on the earnings call.

Applied Materials shares have added about 47.6% since the beginning of the year versus the S&P 500’s gain of 17.2%.

What’s Next for Applied Materials?

While Applied Materials has outperformed the market so far this year, the question that comes to investors’ minds is: what’s next for the stock?

There are no easy answers to this key question, but one reliable measure that can help investors address this is the company’s earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately.

Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.

Ahead of this earnings release, the estimate revisions trend for Applied Materials was mixed. While the magnitude and direction of estimate revisions could change following the company’s just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

It will be interesting to see how estimates for the coming quarters and current fiscal year change in the days ahead. The current consensus EPS estimate is $1.78 on $5.98 billion in revenues for the coming quarter and $6.55 on $22.65 billion in revenues for the current fiscal year.

Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Semiconductor Equipment – Wafer Fabrication is currently in the bottom 15% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.

CAL – Caleres Inc. (CAL) Stock Sinks As Market Gains: What You Should Know

Caleres Inc. (CAL Free Report) closed at $23.57 in the latest trading session, marking a -0.34% move from the prior day. This change lagged the S&P 500’s daily gain of 0.13%.

Heading into today, shares of the footwear wholesaler and retailer had lost 5.06% over the past month, lagging the Consumer Discretionary sector’s loss of 1.2% and the S&P 500’s gain of 1.82% in that time.

Wall Street will be looking for positivity from CAL as it approaches its next earnings report date. This is expected to be August 31, 2021. In that report, analysts expect CAL to post earnings of $0.55 per share. This would mark year-over-year growth of 196.49%. Meanwhile, our latest consensus estimate is calling for revenue of $646.9 million, up 29.01% from the prior-year quarter.

CAL’s full-year Zacks Consensus Estimates are calling for earnings of $2.05 per share and revenue of $2.69 billion. These results would represent year-over-year changes of +246.43% and +27.18%, respectively.

Any recent changes to analyst estimates for CAL should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company’s business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. CAL currently has a Zacks Rank of #3 (Hold).

Investors should also note CAL’s current valuation metrics, including its Forward P/E ratio of 11.54. This represents a discount compared to its industry’s average Forward P/E of 17.91.

The Shoes and Retail Apparel industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 32, which puts it in the top 13% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow CAL in the coming trading sessions, be sure to utilize Zacks.com.

KMX – CarMax (KMX) Stock Sinks As Market Gains: What You Should Know

CarMax (KMX Free Report) closed at $124.24 in the latest trading session, marking a -0.3% move from the prior day. This change lagged the S&P 500’s daily gain of 0.13%.

Heading into today, shares of the used car dealership chain had lost 8.32% over the past month, lagging the Retail-Wholesale sector’s loss of 4.68% and the S&P 500’s gain of 1.82% in that time.

Wall Street will be looking for positivity from KMX as it approaches its next earnings report date. In that report, analysts expect KMX to post earnings of $1.76 per share. This would mark a year-over-year decline of 1.68%. Meanwhile, our latest consensus estimate is calling for revenue of $6.42 billion, up 19.41% from the prior-year quarter.

KMX’s full-year Zacks Consensus Estimates are calling for earnings of $6.97 per share and revenue of $26.47 billion. These results would represent year-over-year changes of +54.2% and +39.69%, respectively.

Any recent changes to analyst estimates for KMX should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company’s business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 3.67% higher. KMX currently has a Zacks Rank of #1 (Strong Buy).

Investors should also note KMX’s current valuation metrics, including its Forward P/E ratio of 17.89. This represents a discount compared to its industry’s average Forward P/E of 18.51.

It is also worth noting that KMX currently has a PEG ratio of 1.03. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock’s expected earnings growth rate. KMX’s industry had an average PEG ratio of 1.44 as of yesterday’s close.

The Automotive – Retail and Wholesale – Parts industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 7, putting it in the top 3% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.